Finance Minister Dr Abdul Hafeez Shaikh. -File Photo

ISLAMABAD, Nov 13: The federal cabinet is expected to take up for approval on Wednesday a tax amnesty scheme Tax Registration and Enforcement Initiative 2012 provided the Federal Board of Revenue is able to finalise a formal summary, according to Finance Minister Abdul Hafeez Shaikh.

Speaking to journalists on the sidelines of annual conference of Pakistan Institute of Development Economics (PIDE), the finance minister confirmed that Prime Minister Raja Pervez Asharf had approved in principle the tax amnesty scheme on the basis of a presentation given to him by the FBR.

Responding to a question if political parties should not have been consulted before launching such a crucial scheme, the minister said the consultation with all the political parties will be held in the parliament once the scheme was introduced in the house.

“Parliament is the relevant forum where the government would consult all political parties on the tax initiative meant for broadening of the revenue base”.

Asked if in his view it was the right time to launch a major drive to hunt taxpayers ahead of elections, Mr Shaikh said there was no bar on the government to launch this initiative as any thing in the interest of the country could be initiated anytime. He said there were four major enforcement issues with the tax amnesty schemes to succeed including a clear cut identification of the potential taxpayers through data, credible evidence of taxable income or undisclosed assets, proper enforcement and targeted approach.

He said the problem with previous drives to issue income tax notices to the people was that these notices were served without proper identification of the person and his/her location but this time the FBR had all the relevant data to contest the potential taxpayers on the basis of vehicles they possessed, their foreign travels and other relevant data.

Mr Shaikh said the government had developed a databank that would help it identify, with evidence, the tax evaders on the basis of their consumption of resources and lifestyles. The credible way of implementation would be ensured and now the government would not just suffice on issuing the notices but would go for proper implementation.

The minister said the government would also seek support from within the society by sensitizing the people to take this issue as national issue.

Mr Shaikh said the major challenge was to increase revenues to meet needs of growing population. “Hence those failing to avail the proposed tax initiatives will face serious problems and get no relief after the expiry of deadline set by the authorities to declare their assets.”

Responding to another question, the minister said that despite enormous difficulties and challenges, the national economy was geared to post a healthy GDP growth of over 4 per cent.

Earlier, the minister enumerated economic achievements over the last four and half years. He told the participants of the conference that inflation had been brought down to single digit from 25 per cent four years ago and conceded that even the single digit inflation was painful for the people.